Having been ripped off by a Nigerian scammer (details here) we asked our local MP Elfyn Llwyd (Plaid Cymru) if there was anything he could do to help.

He was as outraged as we were that the issuing bank knew of the fraud two months before coming to HSBC and demanding that $800 be removed from the fotoLibra account, by which time of course we had disbursed the money. He said he would write to the Chairman of HSBC.

Which he did. He received a reply from David Lewis, Head of HSBC Customer Relations, absolving the bank of any responsibility and arguing that it was fotoLibra’s fault for accepting ‘cardholder not present’ transactions. This amazing statement ignores the fact that 10.7% of all retail sales* are now made via the internet, every one of which is a ‘cardholder not present’ transaction.

Mr. Lewis concluded

There are some steps the merchant/retailer can take to minimise the possibility of fraud, for example asking for the numbers in the post code of the card holder and only delivering to that address (as fraudsters often ask for the goods to be sent to another address other than that of the registered cardholder).

That might have been relevant if fotoLibra delivered boxed goods to physical locations. But we don’t. We permit the download of digital images to an email address. There’s no connection to any part of the credit card.

Maybe a credit card could be linked to a fixed email address which would form part of the verification process? No, that’s probably far too simple. Isn’t it?

We are most grateful to Mr Llwyd for his concern and his response. That’s exactly what MPs are for. Full marks.

*Office for National Statistics, February 2012

Add your comment


19 Responses to “The end of the Credit Card Scam story”

  1. Chris Burton says:

    Full marks for your MP. Zero out of 10 for HSBC for such a ridiculous statement.

    You as a company choose to do cardholder not presents and as you’re selling like a agent then distributing the money it wouldn’t have hurt so much as an online company which ships goods if the banks had communicated the KNOWN FRAUD quickly.

    Personally, I’d hold the acquiring bank fully responsible for the 2 month delay; it’s because of fraud that you don’t distribute the second payment hits your account but 2 months?! Come on…

    Hmmph. “HSBC: The Worlds Bank. (But only for physical transactions).”

    I’m sure the press would be interested in your case Gwyn…

  2. Peter Cope says:

    Concur with Chris on this. Especially as HSBC are currently running a campaign that talks about how it is at the forefront of worldwide transactions. Unfortunately (or, fortunately) I don’t bank with HSBC but would certainly vote with my feet if I did.

    Can anyone else remember when banks served those who banked with them, rather than themselves?

  3. Mick Sargent says:

    Commiserations, Gwyn. I’m afraid that this case only reinforces my opinion, and I’m sure, the opinions of many others, concerning bankers. Totally out of touch with reality, sitting as they are in their ivory towers built with taxpayers’ money.
    However, plaudits to Mr Llwyd, an MP who realises what he was elected for. The three Tory parties should take notice.

  4. Nick Jenkins says:

    It does show two things to me:
    1. Total lack of understanding and gross ineptitude by both the drafter of the letter for the HSBC Head of Customer (lack of) Relations, and said official. Ring the HoCR directly??
    2. Top marks to Elfyn Llwyd for taking up the case.
    Hey Ho!!

  5. I tried to report receipt of a cheque that I considered to be stolen. HSBC were not interest. Scotlans Yard were not interested as they claimed that as I had received it in france it was for me report it to the police there, who would pass it on to the UK. In the meantime the organisation that owned the account were unaware that a new chequebook sent by HSBC had been intercepted and was being used by a group of theives.

  6. Antony Roe says:

    Just about par for course with the Bank. All the banks and insurance companies will wriggle out of their resposibility any way they can. Often this borders on the illegal in itself. Full marks for your MP, ours is very much the same, Edward Leigh, who takes up cudgels on behalf of constituents if he feels we are being wronged. I trust you will be exceeding diligent with anything from overseas from now on. My best regards Tony Roe

  7. Janet Berg says:

    Is there a way to discontinue using HSBC? Would PayPal be an option? I don’t know about the UK, but in the U.S.A. we can take businesses to Small Claims Court. I don’t know if that would be worth your time, but it might be something to think about. That way you would probably get your money back, bring to the public the wayward thinking of HSBC, and also get their attention.

  8. Eric Broug says:

    I sympathise with the story but equally I’m glad that it seems to be finished now. I subscribe to the Foto Libra blog to be informed about issues relating to images. If I want to read about bad behaviour of banks or generalisations about countries, I can buy a newspaper.

    Please regain focus. Thank you.

    • Peter Cope says:

      Hi Eric

      Agree with you but still think its useful to be alerted to these matters. Theft from Fotolibra (as any organisation) ultimately means less money in the pot so we could all lose out!

    • Mark Goodwin says:

      What planet are you on Eric?
      Issues relating to images follows on to issues relating to business, which in turn relates to issues relating to profit and on-going business survival, for all of us.

      Sorry if this issue is boring you, but I think it is tremendously important to all of us who trade on line or by credit card.

  9. Malcolm Forrow says:

    A typical and expected response from a bank, if this was my money I would be pursuing it with the Ombudsman. http://www.financial-ombudsman.org.uk/

  10. Gail says:

    Actually, HSBC no longer own the Card Processing Company. So maybe your complaint should be made against the card processing people?

    • Gwyn Headley says:

      Yes, that was the first point David Lewis raised in his letter: “Firstly, I should clarify that HSBC Merchant Services is a separate legal entity and is not owned by HSBC Bank plc.” I wonder if we’d be allowed to change fotoLibra’s name to HSBC Picture Library?

  11. Erik Strodl says:

    Well, would you expect anything different from the boss of a multi global bank.
    Couldn’t give a stuff….I’m all right Jack!!…..what a way to treat people.
    I don’t trust these bankers or is it ***kers after the huge bonuses they are paid for sitting on their fat arses filling in the Times crossword
    They certainly wouldn’t get any of my money

    By the way did you ever go to the financial ombudsman to plead your case…or indeed did the photographers to whom you paid the money offer to return it as a measure of good will…..it would have been a nice gesture.

  12. Martin says:

    HSBC is also the ‘unfeeling bank’. It seems to have become a very inflexible unsupportive bank and I am serious considering moving all my business elsewhere.

    They have charged my stroke survivor wife with cognitive disability £650 in bank charges for being overdrawn, almost equivalent to 13 weeks of her pension. Ironically most of the overdrawing was due to their charges! At the moment they are continuing to refuse to make any refund, I am continuing to fight. If necessary will also ask Elfyn Llwyd our MP for help.

  13. Mike Mumford says:

    Maybe a credit card could be linked to a fixed email address which would form part of the verification process? NOT GOOD ENOUGH.
    To end of the Credit Card Scam story, simple do not give your customers that option.
    I had the same scams, once bitten twist shy. My answer is to use PayPal* or Google Checkout*, they are the NEW internet BANKS with all the security you will need. My new eBooks can be downloaded quickly and efficiently at the speed of light, no joking. An automatic order is sent to me, telling me which bank* was chosen, automatic confirmation is given (I can check each transaction for full customer details). An automated email is sent to the customer with a 3 day active download link, job done, payment received.
    Please go to Mumfordbooks or Landscape-guides, try it for yourself. If you would like to have the same service for your web sites, please ask for a quote: use Dropdown Tab “Contact Me”, job done.

  14. Paula says:

    We bank with a small local bank (I realize that may not be an option for you). They noticed a charge from Greece on our card, and promptly stopped before even notifying us. They knew of fraudulent charges frequently being made from that country, and that we hadn’t been in Greece for 9 months. We did have to get a new card, which meant changing all our accounts and automatic payments, but by catching this before we did, without us having to wait to get our monthly statement which could have by that time had many more fraudulent charges on it, was easily a lifesaver for us.
    Unfortunately, big banks seem to be out for their bottom line, and not their customers. Anything from Nigeria should be suspect at this time, and the card companies know that. A few more people on the job looking for fraudulent charges (or a computer program set up to do so) would save both the company and the customer a lot of money. Would that really be so difficult?

  15. Phil Smith says:

    Well Gwyn,
    Welcome to grim reality, the banks, once your money is with them, are not your friends.
    Though seriously, the banks could stop this if they wished to but why should they, they have your money and you can’t get it back off them, multiply that by 1 or 2% of all transactions world wide and you will realise how much money the banks are making, millions I should imagine, from transactions they know or suspect are fraudulent and their is nothing you can do about it, except to take them to the small claims court which if you have proof that they were aware the transaction was fraudulent you may possibly win. Or and it’s a big or, try and interest your local police in investigating a conspiracy to defraud case, the bank in collusion with Nigerian scammers, if your evidence supports that view. What was it that great fictional detective said, “when all options are eliminated what ever is left, no matter how strange, must be the truth” or somewhat similar.
    Keep up the good work and thank you for FotoLibra. Regards Phil.

  16. WILLIAM says: